Investors update: April 11 2023 - Emirati telco e&acquires stake in Careem for $400m

Emirati telco e& acquires stake in Careem for $400m

Highlights

• UAE-headquartered e& (formerly Etisalat) has acquired a 50.03% stake in Careem’s Super App spinout for $400 million.
• Founded in 2012, Careem started as a ride-hailing app and then launched its super app in April 2020, which offers a variety of services on its platform and serves customers in 10 countries across the Middle East, North Africa, and South Asia. 
• The investment will support Careem’s super app expansion plans. Meanwhile, Careem’s ride-hailing business will remain fully owned by the US mobility firm Uber and continue to be available with all other Careem services on the existing app for customers.

Source: Wamda

Our Takeaway

For e&, the acquisition deal represents a significant investment in the technology and services that Careem has developed, as well as a strategic move to expand its portfolio of digital offerings. For Careem, the sale of a majority stake in its Super App spinout is likely to provide the company with a significant injection of capital, which could be used to fund further expansion and growth. Investors in Careem may also benefit from the sale, as it could help to increase the overall valuation of the company and provide a return on their investment.

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World Bank provides $390m to boost Kenya’s digital economy

Highlights

• The World Bank Group Board of Directors approved $390 million in financing for the first phase of a program that aims to further develop Kenya’s digital economy.
• Via the project, Kenya plans to increase access to broadband through an expansion of the fiber optic backbone and last-mile connectivity to government and learning institutions, as well as along national borders.
• The project will also boost digital skills to support the uptake of digital services and the development of a competitive labor force for the digital economy and enhance access to regional and global markets.

Source: ABC

Our Takeaway

While Kenya has made impressive gains over the years, becoming one of Africa’s four leading hubs for technology innovation (along with Nigeria, South Africa, and Egypt), there remains a persistent digital divide in access to broadband, digital public services, and the skills needed for individuals and businesses to thrive in an increasingly digitized economy and society. Broadly, the World Bank-backed initiative has the potential to increase access to affordable broadband services and digital platforms, which could help to spur innovation, create jobs, and improve productivity in the country.

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Bitcoin rallies past $30,000 for first time since June 2022

Highlights

• Bitcoin climbed above $30,000 for the first time since June 2022 on Tuesday, bolstered by bets on easier monetary policies that have made cryptocurrencies standout performers this year.
• The coin is now up 82% since December 31, handily beating the Nasdaq 100 tech index’s 19% gain. Gold, another investor favorite this year, has climbed 9.6%. 
• Crypto’s rapid ascent has seen Bitcoin vault past where it stood when hedge fund Three Arrows Capital imploded last summer — yet it remains more than 50% below its all-time high in November 2021.

Source: Bloomberg

Our Takeaway

Although Bitcoin has shown a consistent recovery in its prices this year, it is still significantly lower than its record high of $68,000 in November 2021 and has not yet reached its pre-crypto winter levels following the Terra stablecoin failure. Nonetheless, the recent price surge has prompted speculation of a new cryptocurrency boom, as a result of the ripple effects of the Silicon Valley Bank collapse and the widespread contagion it triggered across financial markets. This has led some cryptocurrency enthusiasts to seek refuge in Bitcoin as a means of safeguarding against the possibility of a complete collapse of the traditional “fiat” economy.